Kenyan commercial banks operating in South Sudan may be affected by possible United Nations sanctions against anyone who undermines current peace talks in Africa’s newest nation, according to the country’s central bank.
“Sanctions to South Sudan could expose Kenyan banks to risks,” the Nairobi-based Central Bank of Kenya said in a report on its website dated Sept. 5. Policy makers should pay attention to any additional “punitive litigations” against financial institutions, regulators, companies and countries for violating sanctions or breaches of contract, it said.
The UN Security Council said in August that it is considering targeted sanctions again warring parties in the conflict that erupted in December after President Salva Kiir accused his former deputy, Riek Machar, of staging a failed coup. Machar denies the charge.
The conflict took on ethnic dimensions between Kiir’s Dinka group and the Nuer tribe to which Machar belongs, as it spread to oil-producing areas, leaving thousands of people dead and displacing another 1.5 million, according to the UN.
Kenya borders South Sudan and is a member of the Intergovernmental Authority on Development, an East African bloc also known as IGAD, which is mediating peace talks in the Ethiopian capital, Addis Ababa, to end the violence. IGAD and the African Union have also said they may place sanctions on individuals who block the peace process.
Kenyan lenders operating in South Sudan include Kenya Commercial Bank Ltd., which is East Africa’s biggest lender, as well as Co-operative Bank of Kenya Ltd., Equity Bank Ltd. and CFC Stanbic Holdings Ltd.
The Central Bank of Kenya report was jointly written by financial industry regulators including the Capital Markets Authority, Insurance Regulatory Authority, Retirement Benefits Authority, and the Saccos Societies Regulatory Authority.
(Bloomberg)
Kenyan commercial banks operating in South Sudan may be affected by possible United Nations sanctions against anyone who undermines current peace talks in Africa’s newest nation, according to the country’s central bank.
“Sanctions to South Sudan could expose Kenyan banks to risks,” the Nairobi-based Central Bank of Kenya said in a report on its website dated Sept. 5. Policy makers should pay attention to any additional “punitive litigations” against financial institutions, regulators, companies and countries for violating sanctions or breaches of contract, it said.
The UN Security Council said in August that it is considering targeted sanctions again warring parties in the conflict that erupted in December after President Salva Kiir accused his former deputy, Riek Machar, of staging a failed coup. Machar denies the charge.
The conflict took on ethnic dimensions between Kiir’s Dinka group and the Nuer tribe to which Machar belongs, as it spread to oil-producing areas, leaving thousands of people dead and displacing another 1.5 million, according to the UN.
Kenya borders South Sudan and is a member of the Intergovernmental Authority on Development, an East African bloc also known as IGAD, which is mediating peace talks in the Ethiopian capital, Addis Ababa, to end the violence. IGAD and the African Union have also said they may place sanctions on individuals who block the peace process.
Kenyan lenders operating in South Sudan include Kenya Commercial Bank Ltd., which is East Africa’s biggest lender, as well as Co-operative Bank of Kenya Ltd., Equity Bank Ltd. and CFC Stanbic Holdings Ltd.
The Central Bank of Kenya report was jointly written by financial industry regulators including the Capital Markets Authority, Insurance Regulatory Authority, Retirement Benefits Authority, and the Saccos Societies Regulatory Authority.
(Bloomberg)